 So, Mr. Lamarro, you talked about risk adjustment and how it negates some possible consequences. What percentage of actual costs are mitigated through the risk adjustment processes in place? Are you speaking to the CMS risk adjustment program? What are you talking about? So under the Affordable Care Act, you, because you have healthier members, have been cutting and basically paying money in, but your competitor is receiving money back through that risk adjustment. So what percentage of actual variation due to the health status of the members actually gets taken care of through that risk adjustment process? Our assumption is that the risk adjustment program is solving for any of those inequities in the market between MVP and our competitor. I will point to, we do have an exhibit already finally where we quantify what the percentage actually is that we're paying to risk adjustment. That's a percent of our protected claim costs. It's on exhibit three. It's on exhibit two of the binder page, one for the risk adjustment program payment of $60. That's prior to that. Ellen, let me get there first. Ellen, any recommendations? We are projecting $60.53 campaign payment into the risk adjustment program. To the index rate prior to risk adjustment in line 30 of $414, the adjustment is somewhere just south of 15%, with the recommendation of LV, we'd add another 1.5% to that. We talked about 40% of the hospital business being done at hospital. So apparently the regulatory authority about care for it, of that 40%, what percentage would be Vermont hospital specifically brought up over a tree and the same hospital that we do not have that regulatory authority? That's actually included in the confidential information that I heard you refer to as referencing. It's not a huge impact. Those two facilities in Vermont aren't driving a lot of the impact of our trend differences. I would like to make one clarifying point, though. The 40% of business that is not governed by the board is hospital plus physician costs. So also included in that figure is any of our community physicians that we contract with directly in the seat of Vermont. So that's not, I just want to make it clear that's not 40% of the business is just leaving Vermont. It's a number that's smaller than that if we account for physicians that are not governed by the board. When you look at that trend of the 5.5%, do you see any correlation between the regulation and the state on those entities versus the non-regulation? Can you clarify exactly what you're... So if Vermont is growing at half that, do you think that has anything to do with the oversight of those hospitals or do you think that it has more to do with what's happening in that particular geographic region? We see a direct impact of the premium care board being able to match the facility trends. We actually put an exhibit together which showed how our premiums have changed since the exception of the ACA over time in a couple of our New York markets relative to Vermont. And what we've seen is that the Vermont premium rate increases and just the level has actually dipped below the New York premium levels. They weren't always at that level. And we do attribute a large portion of that to the fact that our trends are lower which is because of managing the actual facility trends in the facility-owned physician trends by the board. So you mentioned that you negotiated directly with Dartmouth Hitchcock. Yes. As part of that, knowing that 40% of the volume doesn't flood in campus as Vermonters, do you try to tie any potential increases to rates that you're seeing in Vermont? That would be a question I have to follow with our contracting team. We do, I have no surprise, that is the one facility that has the most utilization for our members because a lot of Southern Vermonters go over the border and access care. We do our best to actually keep the costs down. It's just always challenging to come up with the figures where the board is holding facilities to around 3.5%. In what states do you negotiate for your calling versus using your national carrier? It's New York, obviously New York for the most part, and then just Dartmouth Hitchcock. There may be one or two other facilities I'm not recalling that are on the border of New York or Vermont, but primarily it's Dartmouth Hitchcock and then it's New York. So obviously your national carrier would have negotiations in both those markets as well. Have you concluded that because MVP is negotiating directly with Dartmouth Hitchcock you're getting a better rate and therefore that's why you do it that way? Or what is the historical decision point that you negotiate with Dartmouth Hitchcock versus using your national carrier? That would be something I'd have to follow up to the specifics with the contracting team. MVP being we did operate in the same temperature in the past, we withdrew from that market due to challenges with keeping costs down offering competitive premium rate. A number of years back we never offered an ACA compliant product, so I believe the exit was around the time of the inception of ACA in 2014 and it was around that time. Obviously we're still in Vermont and we recognize how much Vermonters and also New Yorkers for that matter access Dartmouth Hitchcock which is my understanding why we continue to negotiate with Dartmouth Hitchcock. You mentioned in your testimony that you believe that you've got the same percentage off that your national contract carrier receives. Obviously there's can't stop us long, there's no such thing as a free life, so how are they compensated for doing the work for you? Is it on a percentage basis, a fixed fee or what? The national carrier doesn't have a robust network in upstate New York, so they actually leverage our contracts for their members that want to access care in upstate New York and then obviously then we leverage their network outside of our contracts. So there is a two way relationship between the two carriers. The actual terms of the contract that would be something that I'm not privy to with someone at MVP is privy to that information and could provide it. Are there multiple options for a national law contract? Other in terms of could we use another carrier? So there are other national carriers, I don't know if there's another one that has gaps in their network in upstate New York where it would make as much sense, but that would be something that I would have to talk to our contract team about. Would you assume that your contract team is comparing what the percentages are on the contracts with their different options? I'm not sure if that information is readily available. I mean that's one of the carriers generally one of their most confidential pieces of information. So I'm not sure how well we have the ability to understand the cost of the national carrier that we leverage versus another carrier at specific facilities. You talked about this board doing an evil thing and making a couple of adjustments this year. I'm just curious because we had this year's filings and one of those adjustments was for a hospital that did not ask for an increase in charges or rates coming here because a number of characters had told them that they could not implement the mid-year adjustment until October 1. Do you know how MVP treated those two mid-year adjustments? I'm not aware of that. My understanding is that it was effective on the date but I don't know that our actual claims, that our process are reflecting those adjustments. Did you do any analysis of one percentage of MVP's overall business? What did you do with those two? We do have an exhibit in our filing that includes it's a confidential exhibit that displays utilization of MVP services by facility in Vermont versus Dartmouth Hitchcock, New York participating hospitals on our rental network. That's something that I can either point to or we could address during the executive session. Is it safe to assume that the percentages in that chart could just be applied to those great increases that have done mid-year? Yes. You talked about there are 44 different ways that MVPs try to keep costs down while at the same time guaranteeing quality for your subscribers. I'm curious if the designation of a particular procedure comes into that discussion and let me give you an example. You've probably seen a number of ads on TV for a product called Colover. And Colover is I think 90 to 92% effective. Colonoscopy is 97% effective. If you talk to primary care physicians a number of them will tell you that even though because there's no family history and health status of a patient that has seen them they still may not recommend that lower cost alternative because of the way it's treated in its classification. So for example, in colonoscopy is a screening measure is protected under Vermont and you have to treat it one way. And what I'm told is that patients have gone for the lower cost option which is the colocard because they don't have to take a day off and work and do everything for the prep and everything else. But if it comes back that there's something that's found the second colonoscopy that is then necessary gets treated as diagnostic rather than screening and so it's a huge out of pocket cost to the Vermont patient and so that primary care doctors are reluctant to go to the step of going for the least cost alternative in the beginning because they know that in small percentage of cases it could be very expensive to their patient in the long run. So I'm wondering if you have those discussions. That would be something that's discussed by your clinical team and any of those kind of discussions. I'm happy to provide follow up if I can go back to the clinical team and understand if those conversations are taking place and what those conversations are. That would be very helpful. You talked about New York State not using RBC but using reserves to premiums and you talked about the 12.5% in New York you're currently at 14.5% How does New York treat TPA or ASO arrangements? In terms of measuring how they account for the 12.5% well ASO and self-insured generally falls under a differently one entity and how that is premiums so basically the ASO client is only paying us administrative fees how that is actually coming into the calculation or if it's part of the calculation I would have to follow up with the New York regulations to understand exactly what they're measuring so to the extent that they're only pulling in our fully insured business the way that communication backs means is 12.5% of our fully insured premiums but they've taken that for granted or with a grain of salt and how ASO the implication has been that ASO is not including that figure but I would have to confirm that what either our financial team or New York State to be 100% confident You've said a couple different times that New York with businesses decline is increasing but it's a small percentage of your overall business if there was similarly a Vermont decline but a large increase in New York business would you come in with a reduced administrative cost in that scenario? What we do is we make a projection of a total dollar projection of what it's about what kind of costs are in our business and the upcoming year really of course and that's generally what we're doing and then we're looking at it relative to our overall membership with some obviously look at how are we operating what are we actually spending in Vermont versus New York etc in extreme scenario we assume that our membership double which enterprise-wide which won't happen but just for scenario see you would have a membership you would be taking the same total dollar figure and then you would have an increase for variable cost divided by a much larger base I would anticipate in that instance we would have a reduction in the PMPM admin cost if it's small we still do account for projects that we're undertaking like updating technology and just other adjustments We were some questions earlier about the Amplatory Surgery Center are you aware that the Green Mountain Care Board from MVP stating that reimbursement for procedures being done there for MVP subscribers is going to be below that of hospitalism I'm not aware of that Are you aware that the estimated cost savings to the system is $3 million in the opening of the Surgery Center? So if those two things were accurate that is the case should there be a small reduction in your filing to indicate those cost savings? If the contracted rates that we're able to negotiate are lower than an outpatient outpatient hospital setting and we can drive utilization there then I would agree that we would have an adjustment to our filing if that information was known I think that's all I have for this session So just in terms of scheduling I think I realize now what you said I think we did a questioning on a confidential document we'll come back to have an accurate session we'll have a lunch break and then we'll reconvene I'm thinking around one for any redirect and cross on the redirect that's fine I'm happy to take a shorter break why don't we make that decision after we finish with the executive session how long the break is well I'm just trying to for people who want to leave and not have to come then outside the room I'd say I'd say we're weakening at one to finish the questioning this way so a member of UCFER has some questions about we would first exhibit we pay which the board has granted confidentiality for under the board's weight review rules we have an obligation to omit references to these materials and the letters of public deliberations and to take other appropriate measures to ensure confidentiality since this is a public meeting we would need to go into executive session to discuss this the applicable statute 1 VSA 313 A allows the board to go into executive session to discuss records that are exempt from public inspection and copy on the public records act procedurally the board needs to make a motion to be made to go into executive session to indicate specifically what the purpose is and question if it will be limited to this document and not the other side of that so can I have one more document? yes two documents is it really paid and exhibited? yes can I speak to that? sure if here's the there's an exhibit 5 exhibit 5A I was being careful and should recall make sure that we did not speak to question 4 because that's confidential information for whatever reason I believe I may even state an exhibit 5 has that information and not like the move to launch because that should have been confidential to pair our money on my part that's the confusion we're expressing so you are claiming that exhibit 5 response to question 4 is confidential because I believe we granted confidentiality for the portion of post 3 we have a client for a second sure and on number 4 should have been mark confidential document 3A and 2 thirds vote from the board should go into the executive session would you say so I can do the motion I moved that we go into executive session to discuss exhibits 3A and exhibits 5 specifically the confidential for the reason that we have a duty under the statute to provide confidentiality for those items is there a second there's signified by the same item so the board decided to go into executive session we would need in the room I believe obviously healthcare advocate and their attorneys our staff L&E anyone else is necessary so everyone else could please leave the room that includes I'm sorry you could shut out the recording we are going to continue our recording as we've also noted in the past insurance recognition is so that every state responsible for those companies that are going to settle in that state in the C&P's case there will be regularities in New York so New York will substantially similar examination to your Pope reply under your relatively similar to prior year and we've read some of this already in the Belch history in the final paragraph based on the entity white assessment above entity white assessment above and contingent on GMCD actuaries findings that the post rate is not had with DFR's opinion is that the post rate previously is around 500% which is relatively small and also we have not received any solvency concerns or communications that are from I have so far Mr. Lucio, are you an insurance gain exam analyst for the Department of Correct? yes I think you have in front of you exhibit 10 which is your letter from DFR correct? your document, letters, your testimony it's under summary of opinion your post rate filed by GMCD you stand by that incorrect people do you see that? yes would you please read thank you and I want to focus on the notion in that last sentence in the sentence before you indicated the attitude to those rates and contributions to surplus are said another way even though Vermont is a small percentage compared to total premium would you agree you still look at the Vermont premium in this rate and determine whether it's adequate yes I would say that's correct you read in your opening the sentences or sentences I should say that are impacted by an assault and stand by that as your testimony right? yes in this letter exhibit 10 was based on DFR's review of the original MVP file of correct correct and in that filing MVP saw a 1.5% contribution to surplus correct did you hear testimony here I saw you today your testimony of Mr. Romardo yes your testimony about L&E's recommendations correct? yes so based on L&E's recommendations your testimony that MVP has increased its proposal from 9.4 to approximately 10.5 based on L&E's recommendations and then another 0.5 due to hospital budget right? yes you have an opinion that this increased to the 11% likely have the impact of sustaining MVP's current bubble of assaults that is correct change your opinion correct and when it comes to assaults would you agree with me that it's not a good idea to kick the can down to later years and perhaps a lower contribution one year say 1% figuring out how to make up for it down to grow with a 3% increase that's solidity perspective I would agree with that are you familiar with statistics on composed CTR violence for single risk pool violence across the country for the last few years am I familiar with it? yes no other than what I write so let's go to that exhibit 9 please page 14 Mr. Lombardo's testimony about two paragraphs under section 15 about reasonableness checks correct and you've read these paragraphs before I did and this is L&E comparing CTR's national visit based on comparison to these five nationally their reasonableness check that NDP and CTR's reasonable and light in the underlying basis I mean this is just to show that the contribution below 1.5% appeared to be an outlier that less than 20% of the proposed CTR's would fall in that category is that right? I believe you testified last year that the DFR review of solvency doesn't end with RBC that it reviews a large amount of data is that fair? recognizing that you're relying on the New York Regulatory Strike go to page 1 of your report please exhibit 10 would you read the second and third sentences? first paragraph in the background exhibit 10 under any background there's a paragraph that starts DFR and then it has three sentences I would ask you to read the second and third sentences and that's what DFR did this year reviewing and recognizing you're relying on the New York Regulatory Strike as well thank you very much does DFR do any independent analysis of solvency? we've received the financial statements so I review those at a high level you're reviewing the answer at a high level again you're a DFR staff and you don't do any independent analysis we don't do a full blown analysis but the New York department does that and you don't go behind the department you're reviewing the actual statement you don't go behind going behind most likely we'll be at some of them okay so you're reviewing what's filed with the New York and filed with HHS and filed with the and filed with the NAIC do you have any type of analysis where you attribute a certain amount of capital to Vermont? you're saying your solvency opinion on page 2 in touch with the private regulator of New York did they tell you that this rate increase was not approved in full but they would have thought it was a concern they did not say that did they tell you if no rate increases they would have solvency concerns no questions any questions for Jessica? one question which Jessica may not be able to answer so feel free to Jessica are you do you form filing specifically the goal of the plan to be revised? no that would be raising form section so I would thank you it would be great if it's approved so I'm looking at the sentence in the commissioner's letter but nonetheless the adequacy of rates and constitutional surplus in a necessary case but I guess my thought would be anyhow is that it's not just rates and surplus rates are certainly important but it could also be a tax credit that bad management that would be starting is that a fair or such? yeah I think you would say there's quanticated and qualitative factors there and so those certainly would take them to a challenge for instance if the entire executive committee that wants to accompany that it's not necessarily a miracle but would that answer your question? I think so I mean you could have for example a technological investment when sour has happened in the past two times leading the organization of capital that they're working up online at surplus so there's a whole bunch of moving parts there that you have to take into consideration at a certain point in time yeah I would say that sir just one more question I think he said that there's a 3-4 years since he died more like an audit of the insurance what was the last time for a meeting? I have to double check that it's in the statutory 3-5 years I could get back to him not exactly sure Yes Jack, I'm going to be in the office that's providing care for the insurance companies, state regulators on actual issues and what is your educational background? I'm going to be taking a master of science at Texas University after college I became credentialed actuary so I'm going to be in the society of actuaries and a member of the American Actuary for 13 years I'm sorry, I think you're 15 and how long have you been retained by the board to provide actuarial services to the state of Vermont? We have been employed by the board since 2014 and in that time how did Vermont have insurance rate violence that you worked on? We have worked on about 65 violence in Vermont and in what market segments have those violence been in? No, the market segments that we have worked in have been the merged individual and small group violence and then we also have reviewed large group and association of violence So given that experience how familiar are you with the Vermont health insurance market this time? And how about other states? How did the violence that we worked on? We have worked on countless rate findings. We have assisted about over 20 states since the inception of the Affordable Care Act working specifically on issues with the Affordable Care Act. This year we are working with nine states to be similar to here where we are reviewing the rate findings Some of the times we have the exact same type of review. Others were more in a guidance role but in either case we are involved in all the filing process. So given that you have done this work with other states what kind of comparative look would you say you have at the National Health Insurance Marketplace? Given that we have worked in a lot of the states it has helped us to better understand what the variables are between the various states. It also helps us on what is changing from a market-wide perspective but also how different states are handling some of the regulatory environment changes and we keep up with that through just our contacts but also just through keeping up to scene on news and new changes in situations. So moving to reviewing the health insurance review I think how do you go about doing that review in general terms? Generally speaking we have three actuaries that touch by the Vermont the first level for this particular filing which Josh had requested. He has a deep dive he has the most correspondence with the carriers reviewing the initial filing that they have through SERV and then I work as a peer reviewer I do a fairly deep review alongside him talking through key issues making sure that he's caught all of the questions that we need to ask and then Dave Dillon also helps out because he has a similar role in the Blue Cross filing that I do but within we talk about the great detail to make sure that we're consistent between the two filings as well as making sure that we're accounted for all of the market-wide changes that need to happen. He mentioned the term SERV could you explain a little bit about SERV Yes, SERV is the NEIC's platform for the submission of great filings and it's the way we communicate with the carriers to ensure that all of this is available to be a public record so that they're sure to experience a good process. And when you are reviewing a health insurance filing and you are assisting the board what is it that you are assisting the board with evaluation? So our charge is to help the board determine if the rates that have been submitted are reasonable and how we go about that is look at all of the underlying assumptions to build up to the rate as well as the starting point and ensure that they've been properly supported that the support appears to be reasonable and that they have accounted for all of the pieces that they need to and when you are making your determination about whether you believe rates to be reasonable are there certain criteria that are defined by the professional guidelines from the state statutes that you're looking at? Yes, we have a lot of guidance regarding rates some are at the federal level, some are at the state level and we have to abide by those. We also from the actual real profession we have standards of practice and we call it actual standards of practice so obviously we have to follow as well to provide us some guidance that is a little bit more specific to our role to make sure that we are at time for all of the pieces that we need to do so. So after a company's filing and getting into SERV how can we do that and more information to keep it running? Typically it begins with an inquiry letter that we send through SERV to each of the carriers we give them a defined time frame to respond so that we can get our responses back and we have that back and forth several times throughout the process. And that was through this filing as well? Yes it was. And how long do you have to review a filing from the time it's submitted to the board? We have 60 days and what happens if it continues from the 60 days? We have to submit a final is it your understanding that 60 days is a statutory deadline? Yes. So talking about today's filing what was your role? My role was a peer reviewer of the filing itself so I took a deep dive alongside Josh's request to make sure that we understood all of the underlying reasons for the rate increase and asked sufficient questions to make sure that we were in agreement or in agreement with where we landed in the period. And we asked for a report with the technical office and back in on page 2 of exhibit 9 we'll see if there's a pair of labeled standard review. Is this your standard review? This is the board's standard review. The standard review is from Statue. This is. And what is LA standard review? Our standard review incorporates some of the portions of the board's standard review. Ours is defined through ASOP 8 where we are evaluating what the rates are excessive and out of control unfairly discriminatory. Did you have any complaint that they did not? Yes. Actual standard practice. Thank you. And having determined what their rate is excessive according to the actual standard of practice. The actual standard defines excessive as having rates that are charged that exceed the amount that are needed to pay for claims admin, taxes, fees, and a reasonable contribution to reserve's profit. And how is adequate defined? Adequate is very similar exhibit kind of to see a closing view where we are assessing whether the rates are sufficient to cover the claims, admin expenses, taxes, regulatory fees, and public health profit. And how is the term unfairly discriminatory defined? Unfairly discriminatory is defined as charging rates to a specific cohort of individuals that is not supported by their respective costs or not supported by federal or other regulatory guidance. And earlier this morning we heard some testimony from MVP about affordability. Did MVP review this filing for unfairly? We did not. Are there actually defined standards for affordability? There is not. Moving to the language in your memo at 30 points around this, you may say that the care assumption is reasonable and appropriate. Could you just give a little explanation as to what it means when you say it's reasonable? I'm sure we use that term to basically state that it is excessive, not inadequate, and not unfairly discriminatory. When we make a recommendation, it's typically because it is violated in one of those that are admitted. So moving to your recommendations, which we've already said that on age 15, could you, could you go into each specific one? Could you just skip to the end and just tell us what the ultimate priority rating person would be if all your recommendations were implemented? Yes. If these initial rate increase was 9.4 percent, if all of our recommendations were increased, changes to 10.5 percent. And just to be clear here in some testimony this morning about budget estimation, information, updated information, since it's also submitted their budgets, is that is there any recommendation in the master that included within recommendation of 10.5? There is not. We can start back into that in just a bit. I'm going to walk through the rest of these, but I'll start from the top. So what is the mental learning that the original file has described to us on age 5? It has five old, if you allow, kind of old trends. It's 4.2 percent. And what is the basis of the unicost trend assumption for this slide? The unicost trend assumption is 4.2 percent. It is accounting for the changes in the hospital contracts between the two patients. And further this morning, there was some testimony about an error that was discovered as part of this during the review. Could you explain a little more about your questions to MVP and what results those conversations were? Sure. As part of our review we want to ensure that the unit costs assumed within the file are matching the hospital budget process since it is well defined within the Green Mountain Parable Hospital budget process. So we always ask them to itemize that by facility in performing that. They recognize that they, the carrier of the key, recognize that they had accidentally used the initial submission of trends rather than the final approved in order to unicost trends. So we're turning back to page 15 and that would be first both times unicost trend. Yes, you recommend that they do in fact reflect the order unicost increases which reduces the premiums by about 4.9 percent. And do you have any other recommendations regarding unicost trends? Yes, as we've discussed earlier today, some updated information regarding the hospital budget process since it has begun has been published in the form of narratives. That typically happens every year. So we were anticipating that happening again. Our recommendation as to the board is that the most up to date information be used with finalizing and producing the order. And have you had an opportunity to review these recommendations for this year? Yes. You had an opportunity, well it sounds like you had an opportunity to review possible budget submissions and draft orders for past years as well, is that right? Yes, that's correct. And let's say just for the last three years what's been the relationship between the budget submission and the rate pass as they are imposed in the biological order from the board? The final budget order from the board is typically lower than 80 original submissions from hospitals. And you heard some testimony this morning from MVP about what their assumption is based on the budget submissions as they are now and do you have any opinion on any of these assumptions? I do not have a formal opinion because we have not seen the breakdown however we did an independent calculation as well and our figure closely matches the 0.5% that Mr. Mulvara reported earlier. We would like to see the backup of that so we do agree that if the proposed trends were incorporated that would be a great change. You mentioned independent calculation and do you think the calculation is wrong if everything has submitted or are there some instances when you are checking the calculations that the carrier has done? We typically do a mixture of both the bigger an assumption is or not greater impact is we will technically review what the carrier has submitted but also perform our own independent analysis to ensure that you are using a different methodology or using different backup data that we come to a similar. So turning to the other portion of the medical trends, what is the basis of the utilization trend in this slide? The initial utilization that filed by any of you was 0%. They had performed an analysis where they looked at a closed cohort due to their very recent large increase in membership. They didn't want to include as much history of data on those individuals. This proved to be very volatile in its results and so they determined it was inconclusive and filed a 0% which is what they have done since 24. We do not agree with that part. Given the analysis and credibility issues that they were experiencing we need to determine that a market-wide study would be helpful. So we gathered confidential data from both volunteers in the market to do a market-wide scan of the utilization. We had some results that could be seen on page 7 of the time of our report. These were all showing non-zero positive trends. So we felt like that is appropriate to make an adjustment. Our recommended range for the market is having a utilization trend between 1 and 4. For NDP, we have recommended a 1% utilization trend and that was based on all of the data we are reviewing, not just the market. We recognize that there is a difference between the populations covered between NDP animal cross and that NDP's specific data has shown some downward trend in their in their past but that in 2018 both carriers did experience an increase which we felt should be reflected but maybe not to the same extent as the kind of differentiation that was before. Back to age 15 and the next bullet point when we were talking about age we needed morbidity in the past. Could you explain a little bit about the association health lens? Have you heard a bit about it this morning? So just a brief overview. Yes, Mr. Olberto's summary was quite good. And in the last year age we have been allowable again which allows small groups to get together to create a larger group called association health plan to see coverage. There's been a lot of changes over the last six months and even last month on this issue. The DFR's bulletin saying that in 2020 these plans will not be allowed to review. So given that information MVP said that they are no longer requesting the rate increase of 0.8% for this particular and what is your recommendation for our date? Our recommendation is to remove the age morbidity load on the planes which would reduce the subjective pregnancy about 0.8%. Could you briefly explain what makes the risk adjustment calculation so challenging? The risk adjustment calculation is challenging from a carrier perspective because it requires the technology of the other carriers in the market that is confidential such as their scores and risk profiles of their populations. Therefore, they aren't very easily able to understand their position in that particular calculation. Additionally for the 2020 calendar year CMS is making changes to the risk adjustment formula so they are changing some coefficients or readings from some of the particular diagnoses and that was also reducing some question marks for each of the carriers as well. And in terms of the timing, how to run through this, the filing here in Vermont was due roughly around May 11 and the risk adjustment calculation payment transfer information comes out at the end of June. So it's kind of right in the middle of our review period which proves challenging because that's not too far away from the 60-day deadline we discussed earlier and it is challenging to have a quick turnaround on that type of information. So to mitigate that over the past couple of years, we have requested the information that they provide to CMS individually so that we can provide a preliminary calculation earlier in the process to typically provide that to them sometime in May so that they can provide us with an assessment of how they're going to change their rates and what great impact that we have earlier in the process. And after having them do that work, does Melanie have a recommendation regarding risk adjustment? Yes. So after performing that work we also did perform an analysis on what the 2020 prohibition change would be and if you combine those two adjustments, we recommend NBP's rates will increase by 1.5% And moving on to our last little point the recommendations on page 15 have changed its actuarial value as we essentially would have standard gold land implementation. Our recommendation was based on correspondence of a few weeks ago in my understanding there's still some looseness to be tied up here in the next week or so I don't know if that will have a material change but we do have an estimate as of a couple of weeks ago that those changes will reduce the overall projected premium by about 0.2%. The recommendations that we've gone through so far have been recommendations involving a change to a fact that we have a great impact and I just wanted to touch on one more recommendation that we have listed here and that's about the new high cost member program. Yes, so you tell us about recommendations regarding that. Yes, this is one of our recommendations and we just recommend to be compliant with the instructions that the that assumption be included under the net re-insurance section rather than the risk-adjusted section that they put it under the original time and to be clear will that have an impact on rates? No one will know. So let's just briefly turn to contributions to reserves for to review for solvency and contributions to reserves? Yes we do and is it your understanding that TFR has the partner's possibility for review for solvency? Yes, they do and did you have confidential information for reviewing for solvency? Yes, we did. And do you find without the assumption of a 1.5% contribution to reserve to be reasonable and appropriate? Yes, we do. So with the recommendations that you have outlined in this report do you find this finally accessible? How are you? Well, it sounds like you've got the report in front of you which is exhibit 9. This is your actuarial opinion, correct? Yes it is. If you go to page 2 I think you're asked about this. I do want to read your standard review before it starts. This letter is to assist the board in determining whether the requested rate is affordable the most quality care, the most access to health care, protects and insures solvency and it's not unjust unfair, inequitable ethnicity or contrary to the law and it's not excessive inadequate or unfairly discriminatory. Can I read that correctly? Yes you can. Is that a correct statement of the task? Yes. The board should consider this report in drawing conclusions in this year's rate of up, correct? Yes it should. Okay, let's go to page 17 please. Have you're signature of the bill? Yes it is. Okay, so you're signing off on this report, right? Yes I am. What are those letters that you have in your name? FSA can be instilled in the Society of Actuaries and AAAA There's a signature above of Josh Cameronquist, correct? Yes. Josh signed off on this as well? Yes he did. And he's an actuary? He is a fellow. And he has those same letters after his name, right? Yes yes. Okay, there's a signature below by Mr. Dillon who I think is here today, correct? Yes. And he has those same letters after his name, right? Yes. He's a principal of post analysis? Yes. So three actuaries are signed off on this report. Correct? Yes. And I think he said you've done 65 violence in Vermont or Rome, is that right? That's correct. And in other states you've done violence in more than 20 states or around 20 states? Yes. And this year you've got just nine states you're working in? That's correct. 18 please. There's a disclosure in actuary over the courts. Do you see that? Yes. Would you read the Actuaries? Please. The responsible actuary is identified above or qualified as specified in the qualification standards of the American Academy of Actuaries. Thank you. And would you read the second bullet please? Lewis and Ellis is financially and organizationally independent from the health insurance insured issuers whose rate buys were reviewed. There is nothing that would seem to impair the objective of the work. So is it fair to say that L&E is not the old MDPs? That's fair. And your opinions are governed by a code of professional conduct? Correct. That's correct. And the ASOPs? And ASOPs. Would you read that please? The purpose of this report is to assist the board in assessing whether to approve, modify, or disapprove the rate buying. And my presumption is that you're not told in advance by the board, so it's a preordained number of ratings that they might like you to fund. You're providing independent objective of the work. That's correct. So independence and objectivity adds significant credibility to your actual work. Yes. As an actuary, you aren't influenced by public opinion. That doesn't enter into your calculus, does it? And that objectivity is illustrated in things that it did not. If your opinion is that MDPs approach on a particular issue is more appropriate, you've said so. That's correct. And that's indicating the existence of records. And if you don't agree with MDP, you say so. Correct. That's correct. And you recommend a change? We call it by the change. Yes. Even if your recommendation results in a higher rate than even MDPs requesting an MDP correct? That's correct. You don't fire at the baseball game and you call them as you see them, don't you? That's correct. And the percentage rate increase that you're recommending this year at 10.5 is what you believe the board should adopt. Correct. The board should adopt 10.5 if there are a few items that are so outstanding. Fair enough. Fair enough. You heard Matt's relating to the July 16th completed the post-plugins of the hospital. That's correct. And that's the most recent data we have that's considered today. Correct? That's correct. And it sounds like you concur with the calculus where they came to a 0.5% of change. You want to confer and see their background. Is that correct? That's correct. Last year, when this issue came up, it's not saying that numbers line up. Just coincident, MVP, similar situation on hospital budgets, they came up with a 0.5 and you reduced that to 0.2 relying on historical data called. Yes. Have you done that this year? I've not had an opportunity to do that. Based on your experience do you expect that if you do that there will be a difference of opinion. It won't be 0.5? I do. Sorry. Do you expect it to be in the range of 0.2? How does it point to 0.3? Last year we started this agreement about how to approach that. You didn't have the benefit of knowing that the board in early 2019 could change the hospital amounts that they could charge. Correct? That's correct. Curring this year? Yes. You predict with 100% certainty that the board is going to reduce reduce from the proposed budgets and this year you're recommending an increase above what MVP is originally filed. Correct? Yes. So with all the numbers, the variables and issues that are an MVP report and your good report they're 11% and you're at 10.7 or 10.8 we're not sure, but close. Correct? That's correct. And that was the only issue of this agreement this year. Yes. And you heard Mr. Mabardo's testimony this morning? I did. I don't believe he testified this afternoon. And MVP for all of your recommendations on page 15 of your report, correct all of the lists? Yes. And you heard Mr. Mabardo, he's also a member of the American Academy, right? Yes. And you know that Eric Bodger who works with Mr. Mabardo also signed him and finalized him, correct? Yes. So if I count that up right, that's five actions. Correct? That's correct. 3 from L.E., 2 from MVP that recommended a 10.5% increase for the caveat that MVP would say go to 11% and L.E. would say maybe go to 10.7, 10.8% for not sure again. That fair? Fair summary? Correct. But they all agree on the increase over the 9.4, correct? Yes. Do you agree with me that five actions are better than one? Well, very smart people have all agreed with the proposed rate increase with this caveat about 10.7 or 10.8 versus 11. Correct? Yes. Administrative costs? Please go to page 13. Page 13 to exhibit these administrative costs. Do you see that? Yes. The personal paragraph read the third sentence please. Because the premium is also increasing from the 2019 and this age I think I might be on the wrong page. Bear with me a second. Oh, I'm sorry. I said the third sentence. I think you're reading the fourth sentence. I tricked you. So could you please read the third sentence? The overall rate impact is a decrease of 1%. And you referenced the 42PMPM in the first sentence. Do you see that? Yes. And then in the next paragraph in the second sentence you say these costs have fallen substantially since 2013 when they were 46.57 PMPM. Do you see that? Yes. Do you stand by that statement? Yes. And then in the second paragraph would you read the last sentence please. And life of the steps taken by the MEP to reduce administrative costs over the recent years to be assumed to the administrative 2020 costs are reasonably appropriate. So it's your opinion that is an act where every amount of care for the MEP to reduce administrative costs over the recent years is correct? Correct. Let's go to the unit trend on page 5. The unit bus trend is just cleaning up the typo and I just want to make sure that you change your opinion. That last bullet on page 5 it says approximately 40% goes on from there. Do you see that? Yes. That number in the original I only think it's correct. That's correct. That doesn't change your opinion. Contributions to reserves Please paragraph 15 would you read this? The first sentence in that last paragraph is only believes the CTR assumption is reasonable and does not refrigerate any changes to the CTR. And would this be true if you increased to the 11% suggested by MEP or the 10.7, 10.8% that may be suggested by Elmene? Yes. Just so the record is clear, I'm not trying to point anything out. If you look at the very first paragraph in 15 changes and contributions to reserves there's a typo in there. So let me first ask you a question. Last year MEP requested 2% and the board approved 1.5%. I will check here. So it looks like the inference could be drawn that the board only approved 1.5% last year. Would that be an error? It was actually 1.5%. Point is in this paragraph MEP is requesting a lower CTR than it did last year. It's requesting 1.5%. That's right. We've reviewed with interest your reasonableness checks which are referencing the second and third paragraphs under section 15 on page 14. Do you see that? Yes. Would you explain what you did here, please? Yes, we utilized publicly available data from the URTs to assess where future reserves were landed relative to the other bodies for the prior two years. And what did you find? We found that the average submit in CTR was 2.95% and the median was 3.15%. These assumption of 1.5% rank as 629 hours would be 775. 19 percent, right? 2018 in that next paragraph 79% of the funds are higher than 1.5%, right? That's right. Do you go on that on visualizing what percentage was 1% or less? When you consider CTR so you've set a site sufficient ones, correct? Correct. That's an extra, you don't want to set a site too much, too little? Correct. And you don't want to be an outlier on that bill? Yeah. You were asked about medical utilization trend and you just want to go over that briefly. You go to page 15 for point of reference that's the medical utilization trend conclusion which would increase the rates by approximately 1.5% correct? Correct. If you go to the bottom of page 6 of your report piece and there's a sentence that starts with because you can read that sentence, please. In the case analysis using their own data Melanie analyzed utilization trends by using market-wide utilization data, i.e. a combination of utilization data areas. So Melanie used more data, correct? Yes. If you go back to page 15 please he makes a recommendation on a variety of issues to modify. Do you agree with me that all these issues are interrelated? They all impact the final there's some pluses, there's some minuses, but they all impact that final one, correct? Correct. Do you agree with me that whether or not that 10.5% rate increase would be affordable? I did not. That's not your job, right? That is not mine. Similarly, you didn't find that that 10.5% increase would promote quality care? Did not. This might just be a quibble, you say under the standard for this, whether this would assist the board to put all these standards in the statute. That's an obvious statement because it approaches to assist the board in determining whether or not the rate is excessive or not where we're unfairly concerned. We're assisting the board by providing the information regarding the department. They make the determination on all of those pieces, but we do provide the information. But your expertise is limited to whether or not the rate is excessive or not where we're extremely concerned. That's correct. You've found that you'll produce inadequate rates? That's correct. You know Mr. Lombardo, right? Yes. Mr. Lombardo is a competent natural right? Yes. Why would MVP submit an increase to submit an increase in inadequate rates? We had more information than he did based on his knowledge. He did submit a rate that was adequate, but based on more information, he determined that it was potentially inadequate. I'm sorry, he determined it well. He was potentially inadequate because we had more information. Potentially. It still sounds like page 4 in the only report at the time. You are at two shows of the current MVP on one report that nobody projected. Yes. So what does that mean? That means that the experience came in that time frame. I'm sorry. Time frame. I'm sorry, I'm not even a part of here. I don't think the mics are working. A while at 20. I said that that means that they had unfavorable playing experience during that time frame. So they paid out less than they expected. That's correct. And less than you predicted. That's correct. You know there would be a zero percent current. Yes, that's correct. Okay. Were they using the same methodology they used in the past? I believe the last two years they have performed an analysis, but I would have to go back here if you might have. In some of the years they felt their data was not credible enough and so they didn't provide us with a lot of information, but I do believe the last two years they performed a similar closed court analysis. Okay, and then as you said in the middle of page seven there's a wide range of results on different analyses. That's correct. So was your conclusion that they were starting to reach that zero percent globalization trend was? No, they kind of disadvantaged on page six. I see that since 2017 NBB has approximately tripled its membership. That's great from the perspective of gaining market share, but it's not great for being able to predict what that population is going to do in the future because they haven't been around long enough. Okay, so you have a lot of data correct? But does that mean that you reject their does that mean that you think that it's unacceptable? No, we utilize their information as well. We utilize their information as well below? No. Do you believe that the methodology they used that produced a zero percent trend was actually unacceptable? Based on the information that they had, no? So you chose a one percent trend that was around zero percent. Can you show me where that is in your chart? In 2016 the second chart to 2020 originally had a 4.8 now it's 5.1 that change is embedded in there as well as the magnitude as well two difference in trend between 2018 and 2019. The combination of those two has included. So I'm not going to find the one percent directly reflected but it's embedded in two of the lines to a correct? Unfortunately this is based on the URT and the URT splits that over two years which makes it challenging to directly see the one. What do you find was a reasonable version of the trend? 0.2 percent that's 5.5 percent. The growth in the sixth case because the fact that it comes in the latest year for this year was the actual drug trend was so much lower than the foreign L&A. Does that give you a pause? Because I do not think this tells the whole story. It does not tell the whole story in that MVP's block of business is healthier on average and there is a risk adjustment component that makes it challenging to look at planes of formation in isolation of that very large figure. Can risk adjustment encounter it? Yes. Have you seen it encounter it? MVP's payable is quite large and even on a PMPM basis it's quite large. PMPM I'm sorry even on a PMPM basis it is quite large. There risk adjustment payable. There is a large amount of difference between 4.4 and 11. I have not done that calculation because you can't break that out as easily but I can see that being the case. Last year MVP assumed that because of the zero penalty for the individual mandate. Yes. And you all assumed the same thing correct? Yes. And that didn't prove to be true? No. That is the assumption about people being equalized of zero and proved to be incorrect. Yes, they do. Can you explain how MVP handles pooling planes of all 100,000? 1000 dollars to ensure that they are not over reacting to large planes and to sort of out of their experience period data so that it's not impacted by large planes. Do you know is that methodology typical among companies? Yes. Do any companies use the actual rather than the accepted? Very rarely I would recommend it because then in some years you could have a great increase due to one claimant that may or may not be around in the next time period. Sure, but you haven't seen that have you seen that type of increase here? Can you rephrase what you got? What type of increase? Have you seen a huge increase that would make it improper to keep the analysis based on the actual rather than the expected? They've always performed this calculation to smooth out the data. But they've always done the expected. Correct. Can you turn to the top of page 10? I'll be saving nine. Yes. Here's the average age factor. What is the average age factor? The average age factor generally measures the average age of the population and that's associated with a rating factor for that age. So does that mean the average age factor goes down? Roughly yes. Yes. And you see that the average age factor does go down, right? Yes, I'm not sure. But MVP has used the same age factor despite the fact that the average age factor doesn't be going down. On page 10 there's a discussion about the change in the age of the people and a similar increase based on the prior age of the population back down correctly. Yes. Would it be reasonable for AHP to also reduce the rating because of some people who are in AHPs in 2019 back into the extreme one? The experience period is 2018 and AHPs were not allowed. Do you know what the risk adjustment was on the most recent day they had available? Which is what they included as their assumption. And is that the same methodology that they used in past years? Yes. Last second. So why not just accept? Because there was new information since the submission of their filing there are changes to the risk adjustment formula as well. And it is a different population. Whether it's MVP assumptions regarding risk adjustment or no news assumptions regarding risk adjustment these are all correct? No. The first set of that is no longer an estimate. It is a final figure. The first figure the first recommendation is a final figure. Do you know do you in your report say that MVP for the 2018 figure? Yes. For 2018? That's correct. That's what we're recommending. What about 2019? 2019, that's irrelevant to the filing? That is irrelevant to the filing. So you said in 2018 was it? Yes. They were certain that that will be yes. I guess we'll see next year. Did you consider this filing? Whether MVP could or should be a top negotiator with health You asked the question part again? Yes. Did you consider whether or not MVP should be a tougher negotiator in New York for 6.5% rate increase? Would that trouble you? No. But the fact that if MVP has a 6.5% increase in New York by 11% or you're recommending 25 to 11% increase in Vermont? It's a different population that they're assessing and determining the rate increase on them. Does it only advise their exchange rates? Any charges this year regarding the MVP? I don't work for MVP. I don't work for clients that participate in the individual and small group markets. Does it only do any work in any state that has a statutory standard governing the law holding this at a rate like Vermont's? A lot of the states have increased their oversight. I still believe that Vermont is one of the toughest though. Do you know on any other state that have the same standard for Vermont? You don't know in any state that fires would be a regulator? In 2020? In general? The general process or the actual guidance that we issue fires that state to review filings in excess of 10% and minimum? Yes. But not all states review filings that's correct. Not all states do the states we work with do, but that's not... And when you did your reasonable mischeck and pulled up 777 filings did you exclude states that did not review filings under 10%? I would have to be driven and questioned to Dave, but I don't think we did. We used all the data they had available to us. Thank you. Page 3 of your official I would say zero. Right answer. I asked about it because a third cash flow is from Medicare. And in the last few years that's part of the theory of hybrid. So, first of all, in the rearview mirror, you kind of tried to figure out what I just said in 17, this population is not a Medicare population. Analysis hasn't been done. You can filter that out of the analysis too. Are you referring to the rape unit cost increases? The way I'm finding this is the actual revenue from our hospitals from Medicare. I can give you the numbers. The reason I asked is I didn't believe that the EDMC does provide a breakout for a commercial loan and it's serious, so that is why we have commercial data and we have Medicaid data. Right, I just think they break out which is the only reason that they break out what commercial is versus the other reasons, the others. The one I understand don't, but they actually did and ever since there's a large percentage that doesn't see a little bit of weight in one number that they're using. If that answers your question. Well, I don't have any answers to that. Thank you Jackie. The question, two questions actually. Given the submissions of both carriers, I'm wondering if you have done any kind of assessment of what you expect the market share to look like? Right, definitely over the last several years we have known that many people are sitting significant in the world that shows that it's highly appealing to the fact that it's dipped below what we saw several years ago. That has persisted and even at substantial substantial margins. So I suspect that if you continue to gain the more market share in the coming years if he has modified by our recommendations those are older than that same number of years. And to that I think we have on things like administrative cost for more than a month there are other types of aspects of the market share. Correct. It will have impacts on several pieces. Right now, Indy being a lot of healthy members because those who are technically the most crisis to jump sooner than others. I would suspect that their healthy population will start to deteriorate when they get members to do be utilized but that are going to switch over. So that's going to stabilize a little bit so it's also going to be a good adjustment the environment might change from an administrative cost perspective it really depends on how the organization determines their administrative cost. Indy at least hasn't talked a lot about that today my reaction to that is I think the way that Indy being has done it to include New York is not beneficial for the current situation but when the situation was reversed and they could have the water market share we didn't see a lot of movement here on the Indy so we actually around the Vermont side we actually did see a decrease because of all of their initiatives but not due to a substantial increase and a decrease of the loss so rather than understand that it's not assisting this Vermont fighter which is unfortunate I do wonder about the whole search to change but also the whole other administrative costs to skyrocket in case you start to lose that membership but I do think there is some correlation depending on how the organization determines their administrative costs and I said that the question actually relates to what we just talked about on page 2 so you have an initial distribution by an adult based on the submitted request and then on page 16 with the revision you have a new distribution by an adult level on page 2 to the table on page 16 you see some movement within mental categories of membership and I'm wondering if you could talk a little bit about how you came up with that change in that distribution in a particular risk adjustment in the sense that the impact of the risk adjustment depends a little bit it seems to me from what I've read on an adult distribution with a higher impact on low risk bronze members you know that it has a higher impact on high risk yeah that's correct yeah how does that all play out right and so in a perfect world risk adjustment would match up one for one cost perspective but it's not and so CMS recognize that and that's why they are have changed as for the 2020 the better of the line they've had an experienced impact on those low claimants who are healthier which obviously have actually made the most due to studies as you can see that's greater than what these are and how we kind of handle that and we looked at what the changes were to that risk adjustment so that we could better assess that from a global perspective and we're hopefully going forward that's going to start to match up one to one and then this distribution will change primarily just due to premium differences between the two carriers again low cost members tend to be more price sensitive because they're not really working with a doctor and they're very closely on particular diagnosis that they have so they're willing to change the PCPs versus somebody who's had a long term illness that they work with the same doctor that they is covered under both or they're getting some nervous to switch because they have a little impact due to the complexity of all the insurance so to see the shift really is going to be due to premium changes most likely and as those are all likely to shift to one so I understand that one of the things in the page 16 of this distribution that you predicted that obviously it's going to change from page 2 to page 16 so the fact is that with that prediction are not only great changes within MVPs but also the relative comparison to the recovery shield and how competitive each metal level is both the fact way to your institutional predictions yes and I wanted to look into that that figure here because the numbers in the on page 16 match the numbers that are here on page 2 they're just in the second chart so this is the 2019 changes so those are based on 2019 membership and then the one and I have to look because that's different up here so maybe this is 2018 and this is 2019 this is not a prediction these are actual I thought you were I thought it was a lay based on the only recommended overarching this is what you would expect and no that is to help us calculate the overall so do you do that now on that prediction distribution of metal half based on we have none that are useful but we have published that in our report sorry no problem thank you I have a couple questions on page 16 I want to chart that can you say where the negative 0.9% on the budget and projection changes from hospitals 8.3 so no they when you re-submit 8.4 we're going from 8.4 to 10.5 correct that would be in line 2 and line well I would say primarily line 3 because it's for 2019 so and then just talking about risk adjustment we've had a lot of discussion on risk adjustment and because we are really two primary insurance and state do you really look at that as flipping one to the other so where we're seeing 1.5% increase on top of that 4.4 so when I look at these rate change 5.9% risk adjustment that's correct and so I'll come back to that part in the second to 5.9 the change that you're putting in of the 1.5 you have offsetting that across the submissions so that the numbers tie out we are not recommending such that we have to lump their zero that's really complicated because they have two separate projections for ownership so the figure is highly tied to how much membership that they have and so we haven't done that direct comparison to make sure that we multiply their projected membership as a PMPM that actually matches up with zero we have projected what we think or recommended what we think is the most appropriate figure for both of those and that it will be close enough to being protected I didn't know what you said the intent is that it pretty much balances and then if MVP grows people come into insurance and there's such a large risk adjustment on the PMPM is that correct assuming they can't keep getting just the healthier people that's to kind of balance that right so how does that work because we're calculated on a PMPM it's pretty significant PMPM number that are in their rates and we're thinking more people that number would go down should we just strike that out next year yes I think more people that never will go down when you go to review the Blue Cross by thing you can see to that their number is kind of going off so we can run up I guess it's highly correlated and that's why even a couple of years ago and MVP had a really large amount of payable but it got many members the capital was really high for them that number is going to continue to drop if the membership continues to go up I also think as we discussed earlier that they can't continue to just get healthy members in the lead so that's also going to stabilize which might bring that we'll just kind of hopefully take it down across the board because they are related to one another such that MVP is not making such a big payment into the pool as well that's all right, thanks can you read for us? I just have one more question I think the HCA brought up currently involving the 2019 there's any any calculation you can have to address the people who are possibly returning to the marketplace from the 2019 HBAs I'm sorry I didn't hear that returning to the marketplace doesn't work returning to the marketplace from the 2018 HBAs thanks no can you explain why that is all right so the 2018 is the experience period that is being utilized here and there were not agents present during that time so we're not getting back on because they were already included in our experience period the only thing that happened was they renewed from the rate which is the 2019 rate the impact of thinking that those individuals could be thank you I hope it's simply that like the commission of last year that they were just being presented can I speak of that last year that is how it worked I did get the outset to say you're just going to be providing a narrative I may have to be completely rude to them Jack at some point be saying something about them Jack didn't have it last year but I just wanted to I'll take that I'm Mike Fisher and I'm the chief I'm sorry you just want to I'm a chief healthcare advocate and I just want to speak for a few moments and come from a bit of this perspective that you've heard all day And speaking of all day it's been a long day, I think to say today that it is broadly understood by most reformers healthcare coverage and getting care is a barrier that prevents some people some of our learners from getting It's important though, even though this is probably known to take a few moments here to make sure that it's set out properly in person. Focus on and consider the consumer's perspective. The stress that reminds you of the experience when they need care and how they're going to get and how they're going to pay for it is real. Affordability is a consideration of the consumer's ability to pay for coverage and care. Simply put, can-for-mockers, can-for-mock families reasonably get the care they need or the care their providers recommend and do things like put a phone on the table or eat their horse. And can-for-mock small businesses provide a meaningful healthcare benefit to their employees and survive taking the margins of their business. We recognize, I recognize, that the board can't achieve full affordability in this way of life. A zero percent rate increase wouldn't achieve this. This means the question before us today is not yet how insurance will be affordable to all-for-mockers. The question is how many more for-mockers will be priced out of the ability to get the care they need for the financial well-being of our monitors and the financial well-being of MVP healthcare in this case are competing pressures? The board has a tremendous, really difficult task in front of you. There's no easy answer to that. Yes, we need healthy carriers and yes, we need rates that consumers can buy and that they can afford to use. It's been interesting for me to listen today about the actuarial considerations. Without any consideration of the consumer, I think we need consumers in order for this to work. The ability of the monitors to afford coverage is key to the success of healthcare funding. It's not a nice afterthought after the actuarial societal rates. To give an extreme example, it doesn't celebrate a rate that was as actuarially sound as possible. If only more and less. So the 2018 House of Health Insurance Survey, I believe that's 17, if you're going to quote today, 40 percent of us, 65 in the commercial marketplace are under-disturbed. 40 percent. I wonder, by the way, four years early, 14 was 27 percent. I know these proceedings are not about plant designs, but when premiums rise, more and more and more monitors are forced into plants. Some people in that 40 percent category, they have a $15,000 deductible means when they have loved ones who need care. Others may not be worried about that. Most days, every day, from monitors with affordability concerns. But today, I'm going to focus my comments on the comments that were submitted to the board in the last few days and weeks. It's an interesting list of comments. We break them into a few themes. Many people said, these rates are unaffordable. These rates will force us to drop coverage. Deductibles are also unaffordable. I don't go to the doctor. Health insurance is our biggest household expense. This rate will hurt my business. This was said by the board again four days by the way. Health insurance costs keep me from being able to put money into savings, retirement, college funds. Health insurance increases are far outpacing wage increases in Vermont. This is unsustainable. But just to be very brief, comment number 13 said, monthly premiums plus high and ever-increasing deductibles are already a huge financial burden at 20% of my gross income. Another increase with that anticipated increase in income only makes this worse. I'm also a health care provider who accepts insurance and not see reimbursement increases across the board, making a premium increase request even more frustrating. Another commentator recognized herself as a small business owner. She said, our family board has no options for health insurance, but privately had converted at about $1,600 per month. Yes, $20,000 a year. We'd like to save for college. We'd like to take a family vacation before our kids leave us. We'd like to pay our mortgage and save a bit for retirement. We fear going without insurance desperately trying to keep our family safe. How can anyone afford this? Another point of information that I found interesting is that this year, roughly each regional medical center in its hospital budget submission is requesting a 2.65% rate increase effective October 1st. Directly relates to the increase in their free care program. Each of the provided free care has increased by $2.5 million from budget to budget. They report that they have not changed the eligibility of free care. Rather, this is the result of an increase in patients who have insurance but can't afford the deductibles and equal days. Nearly 48% of their free care is provided to patients. There is a risk that we become desensitized. These expressions of fear and frustration. While there have been times in my life where I've never had to face the fear of being scared to death of what it would mean if I had a family that I didn't know about with insurance, I've never had to face the fear of being scared to death of what it would mean if I had a family that I didn't know about with insurance and afforded a more distant perspective. For me, our full experience, I don't know if you've got the opportunity but it's a powerful experience and take the time to be the calmest that came to you in the last couple of days. Yeah, some of them were shaky. Some of them were not completely on target. But many of them were from a regular Vermont family doing their best desperately wanting to lose the game. Thank you. I do. You're not an actuary. I am not an actuary. That's all I am. You're saying that you've seen a period of small increases in Medicaid, especially in Medicare. So when that comes in that's higher than the medical inflationary rate that government takes on responsibility? Absolutely. Thank you. Which is just to your point about becoming a sensitize, I just want to assure you and everybody that you're an acquaintance and speak with that. I can say to you that I'm not a sensitize. I hear it all the time in the mouth. You're going to want to be that everybody you can imagine what the next conversation is. And I just want to assure you and everybody else that I know that we read all the comments and have a special forum tomorrow night and we welcome those comments and I just want to show you that we're not sensitized and we're listening. Thank you. I'd like to take a comment. So you wrote an op-ed, you said, but when a sizeable portion of the moderate can't afford to get there, those same neighbors and policy makers to see the crisis, I assumed I was one of those regulators. And I've developed a little bit of offense to it because you know that in my concurring opinion last year on this rate filing, the first sentence in that opinion was I write separately however you discuss my deep concern with the evidence presented has to the affordability of the proposed rates. And I went on and I wrote the proposal that has a form of finance committee. I think it's a very finance commission. I think it's an incredible proposal. So but in order to move these in health from state entity to give us a number of work for it. And so when these plans were presented last February, I asked to give us a number and they said they would. And then when June 7th, there was another meeting and I asked again for the update and I still haven't received it. And for me until I know what the price tag is on something it's hard to advocate for except conceptually. So I'm just going to ask you, will you help get that number from deep so we can have a measurement of what a subsidy is above the 100% of poverty, 500% of poverty below the 9.8, 96% threshold. There's a number there. There's a process to do it to solve some of these problems. So I'm happy to engage in understanding sort of what the cost of finding a reasonable slope on poverty is a great activity, the needs of homeowners. I don't have the experience of knowing that fear and desperation, that one time he said something very, very good. He said that stress, the financial stress of figuring out a different health care is the conducive to anybody's health. So I recognize the tremendous work and the tremendously impossible box that you are all in. I think the main task I'm here to say is this is a balance in that. I don't know that the sum pile that you can't upset. I don't know whether the base of that sum pile depends on your perspective a little bit. But we need to have that. It's hard to get rid of the problems and the parties should make closing arguments and then you can briefly test them. A percent increase. L&E and MEP agree on 10.5. Those is 0.5 percent. They've provided evidence on L&E. That's the fight today. They need to check the numbers themselves. But it's fair in terms of B, it's going to be roughly 2.7 or 2.8 percent. You can see on that. You'll see that before you have a final decision. We have all the two factors and considering all the statutory criteria, the actuaries are virtually identical in agreement. We've got two MEP actuaries. We've got three L&E actuaries. They all agree. There's no contrary expert evidence supporting a different number. Considering a final number, we would respectfully request or consider a break within so that these actuaries sound reasonable and statutory adequate. I did mention this slide. Stat of stones this morning and how the actuaries have found just the right balance to meet all of the statutory criteria. We have the information to consider all of the statutory criteria. We would just ask that the board not pull a large non-actuarial stone from the middle of that stack and cause the rating to be inadequate and all those stones come out like that. Thank you very much. The hearing officer and Mr. Chairman was awarded 400 points. Number one, looking just at the actuarial analysis, there are all kinds of different methodologies, different types of analyses in connection with which the board has discussion and in connection with which both the characters and Anthony were wrong last year. They were both wrong because they assumed that zero and having zero had a deeper individual mandate would make a difference. They were both wrong about analyses. Judgment. Well, lots of judgment is allowed. So for example, they may choose naturally they choose to use a straight average where the trend is down and it would make just as much sense to follow the downward trend to wait for the most recent data more carefully. So on those issues, the board has a discretion and I think it should err on the side of trying to come over to the age of that extent possible. On the other hand, if there really is a hard number, for example, if Ms. Lee is right about risk adjustment, their risk adjustment methodology using hard numbers, objectively verifiable numbers. That's different than I would that if there's a hard number that may have something to do with the hard question I forgot. But the only hard number in the analysis if Ms. Lee is right is the risk adjustment. All the others are subject to discretion. Third point. The company can't have both ways. Either the minister of costs are indivisible, total adjusted capital that is a solid issue that's indivisible or there are both several. What MVP is trying to do is to say well because New York business is going to be decreasing reminders have to pay for that what's going on in New York but at the same time even though MVP's total adjusted capital is the rate increase here has essentially no effect on their capital. The MVP should still be contributing as much as New Yorkers to that. Both great pieces. Finally after all the actual analysis is done there's no question about that. This is the only state in which the court ability is a criteria. Ms. Lee was very careful to say she is not recommending that the board raise the rate by 10.5%. She is recommending that a 10.5% increase does not produce rates that are excessive where I'm very discriminatory but that's a far cry for recommending an increase in another criteria in the statute. To follow up on this discussion there were a number of questions that board members asked. People in clinical department or contracting I will follow up on these responses back prior to the due date of the lease. Is that fair? Fair? As we did last year we'll make that if you write any questions that was very important as we did last year because we don't want it. We have our notes but if we misinterpreate what the particular board member would ask if there is an issue around timing we can refer to if we have a hold up on these figures. We do have it wouldn't be ideal to extend the period to take additional if I understood correctly we will be getting an event to change from now on the standard board plan to date or tomorrow. The expectation for the form submission would be today impacts the rate filing or I'm sure we'll probably be able to do that today. They don't have today and I believe and would you like us to submit that to evidence in this proceeding? Whatever it is? I think it would be the other asking the request or I heard testimony that Alan you would like to see the calculation for the hospital budget by 5% so let's take a look at that and you're able to Jesse you would need to notify when the forms are approved correct? I believe as we did last year I don't mean to work on the plate about me but I think that they we were testimony that it might be 0.2 it might be 0.3 but they would actually file something more certain on that I guess. We will discuss putting their calculations out there in order to so I think we're going to include your portion of the proceeding and now we need to the public comment portion so there was a sign of sheet for public comment outside and we just had to state all the details of the portion. I feel like the consumer is underrepresented in these particular areas I know there are a lot of ratings expected to be a certain way but I seriously felt on this one something was missing consumers that are very concerned about what is happening right now are not here but they really are here some of don't know about it so I can imagine someone about saying and MVP is like the child that was turned 18 by group just leave when they hear what these numbers are assuming you passed if you were to pass this kind of increase no matter I don't see a lot I see a lot of consumers are going to look back here and come and say that possibly they don't know this is part of what gets really scared because it's not just health care it's across the board what was the last year it was a high amount what did their income go up incomes don't go up by 5% a year 6% a year 5% and I was actually playing with this I want to go up there next year in recovery and ask them to pass a bill that puts in the minimum wage that it goes up automatically at 100% let's see how that goes across but I also understand the point that the state of Vermont under funds they're shut out of the situation at all and it gets very complicated no company sells solvency and affordability of a service if the solvency is theirs alone they do I'm not really they're doing what they need to do but that is more about what is the consumer perspective going to be what are they going to see is that how they're going to feel what about them what Vermont market is and what Vermonters can really afford versus this is the option that came in for the long reasons as well as this we need that these rates go up like this the possibility of going up like this we need a better definition right from the start but what is our market that we can actually afford and let's see I'm not going to say that there's this time the load is strong and I'm not going to read that so I do believe we need alternatives I think we're getting at a very universal point, is it going to be exciting or is it going to be a disaster as these economic factors come into play and we start seeing these kind of costs this is if you're an inventor if you're a creator you actually get excited over scenarios like this because you start thinking wow there's some real wave over and just see if I can't do it better maybe more affordable and still I mean as an engineer if I heard something like this we'd be all over it we'd be out there bidding and we'd be like hey give us a shot at it we can do this it's so complex but I think we're looking at that we're seeing some really high numbers coming in we're seeing flat wages and I think the real answer is people are going to say no they want a better solution it must have a better solution they aren't going to buy it and somebody out there is going to invent something there's enough wave over now that very well it would be better I think that's a consumer perspective a consumer perspective they will tomorrow slowly to comment on the public and based on the bottom with comments we will see fairly well with them but it's a little bit heavy but at this time we'll entertain a motion to adjourn it's been moved and signed to adjourn all those in favor sign by the senate bye we'll be back again tomorrow at 8